Fixed rate bonds newbie question

ChrisFN66

Hi, am I able to have more than one fixed rate bond? Reason for asking is I have around £120k to invest but notice the total amount I can invest into a bond is £85k. So could I use my remaining £35k on another fixed rate bond? Or is the total maxed out at £85k per person period?

masonic

You can have as many as you like, but individual providers may restrict how many you can hold with them. It would be advisable not to have more than £85k savings with any one bank (and make allowances for interest), so splitting between two unrelated banks would give you full FSCS protection for your money.

EthicsGradient

Perhaps worth noting that "related banks" are, for instance, Lloyds and Halifax - the former owns the latter. So there's a maximum of £85k protected by the FSCS for all your Lloyds and Halifax accounts combined.

eskbanker

EthicsGradient said:

Perhaps worth noting that "related banks" are, for instance, Lloyds and Halifax - the former owns the latter. So there's a maximum of £85k protected by the FSCS for all your Lloyds and Halifax accounts combined.

Right principle but wrong example - Lloyds and Halifax operate under different banking licences, despite being within the same corporate group, so you'd have two separate £85K protections.

Ayr_Rage

There isn't normally such a low limit on a bond, the £85,000 you mention is the FSCS limit.

I've had many bonds well over that amount as I am prepared to take the small risk of the institution going under.

EthicsGradient

eskbanker said:

EthicsGradient said:

Perhaps worth noting that "related banks" are, for instance, Lloyds and Halifax - the former owns the latter. So there's a maximum of £85k protected by the FSCS for all your Lloyds and Halifax accounts combined.

Right principle but wrong example - Lloyds and Halifax operate under different banking licences, despite being within the same corporate group, so you'd have two separate £85K protections.

Thanks for the correction,

masonic

Ayr_Rage said:

There isn't normally such a low limit on a bond, the £85,000 you mention is the FSCS limit.

I've had many bonds well over that amount as I am prepared to take the small risk of the institution going under.

There are a small number of institutions that do consistently limit to £85k. I don't know if it is intentionally related to FSCS limit, but it is something I have noted.

saajan_12

There's no legal rule about how much you can invest in a bond or how many separate bonds you can have. So the only limits are 
* how much that provider will allow (up to the provider)
* if the bond is inside an ISA or pension wrapper, then there are limits on how much new money you can contribute
* if you want to protect against the bank going bankrupt, then only the first 85k is protected by the government under FCSC protection. You can still put more in if you choose. 

Albermarle

masonic said:

Ayr_Rage said:

There isn't normally such a low limit on a bond, the £85,000 you mention is the FSCS limit.

I've had many bonds well over that amount as I am prepared to take the small risk of the institution going under.

There are a small number of institutions that do consistently limit to £85k. I don't know if it is intentionally related to FSCS limit, but it is something I have noted.

Just flicked through a couple of pages of Moneyfacts and the normal range is max £250K to £5Million ( Nat West).
Most common is £1Million. 
Only outlier was Atom with £100K.
Although you are right there are a small number with £85K limit that I remember vaguely from other threads.

Bigwheels1111

Albermarle said:

masonic said:

Ayr_Rage said:

There isn't normally such a low limit on a bond, the £85,000 you mention is the FSCS limit.

I've had many bonds well over that amount as I am prepared to take the small risk of the institution going under.

There are a small number of institutions that do consistently limit to £85k. I don't know if it is intentionally related to FSCS limit, but it is something I have noted.

Just flicked through a couple of pages of Moneyfacts and the normal range is max £250K to £5Million ( Nat West).
Most common is £1Million. 
Only outlier was Atom with £100K.
Although you are right there are a small number with £85K limit that I remember vaguely from other threads.

If you opt for a Raisin account, They limit savings to £85k per saving account ( partner ).

masonic

Albermarle said:

masonic said:

Ayr_Rage said:

There isn't normally such a low limit on a bond, the £85,000 you mention is the FSCS limit.

I've had many bonds well over that amount as I am prepared to take the small risk of the institution going under.

There are a small number of institutions that do consistently limit to £85k. I don't know if it is intentionally related to FSCS limit, but it is something I have noted.

Just flicked through a couple of pages of Moneyfacts and the normal range is max £250K to £5Million ( Nat West).
Most common is £1Million. 
Only outlier was Atom with £100K.
Although you are right there are a small number with £85K limit that I remember vaguely from other threads.

Perhaps I noticed because it is incomprehensible. It is not in any bank's self-interest to ensure their customer is fully FSCS protected. So perhaps a minority consider it part of their interpretation of the obligation to act in the interests of the consumer. It seems unlikely they deliberately want to restrict funds coming into the account, as they'd probably set the limit much lower if that was it.